Apple iPad Selling Faster than iPhone, DVD Players

 
 
By Nicholas Kolakowski  |  Posted 2010-10-05
 
 
 

Sales of Apple iPads are outpacing sales of both iPhones and DVD players, according to an analyst note, and tablet computers are likely to become the country's fourth-largest consumer electronics category, after televisions, smartphones and notebooks. That raises the question of whether competing manufacturers' upcoming tablet offerings will be able to make a dent in Apple's lead.

"The iPad did not seem destined to be a runaway product success straight out of the box," Bernstein Research analyst Colin McGranahan wrote, according to CNBC. "By any account, the iPad is a runaway success of unprecedented proportion."

The iPad's current sales rate is 4.5 million units per quarter, McGranahan added, predicting that sales of the device will be about $9 billion in 2011.

The question now is whether Apple will be able to maintain that sales momentum with new tablet competitors on the market. The Android-running Samsung Galaxy Tab is scheduled to debut in fall 2010 on four carriers, and both Hewlett-Packard and Research In Motion are developing tablets that run proprietary operating systems. In addition, Microsoft CEO Steve Ballmer has promised that Windows-powered tablets will arrive by Christmas.

Those manufacturers may be concerned about the iPad's possible cannibalization of the traditional PC market. That idea gained widespread attention in September, after Best Buy CEO Brian Dunn was paraphrased in The Wall Street Journal as saying the iPad had cannibalized more than 50 percent of the company's laptop sales; Dunn later disclaimed that view, but nonetheless the "cannibal" meme spread across the Web.

While some analysts-notably NPD Group analyst Stephen Baker-have suggested that reports of iPad cannibalization are greatly exaggerated, others assert that the devices are forcing the traditional notebook market in a new direction.

"We expect tablets to continue to pressure PCs as more vendors launch products (e.g., Dell Streak and Samsung Tab) and Apple expands its iPad distribution," Morgan Stanley analyst Katy Huberty wrote in a research note, as quoted by Fortune Magazine Sept. 17. "Tablet cannibalization," she reportedly wrote, is a significant factor in U.S. notebook sales' 4 percent year-over-year decline in 2010.

That sales data came from the NPD Group, although Baker suggested a decline in low-end notebook shipments was natural after "atmospheric" sales in 2009.

Whether or not cannibalization is actually occurring, other tablet manufacturers have a potentially long road ahead with regard to matching the iPad's total sales. In order to preserve something of a first-mover advantage, Apple is rumored to be developing a second-generation iPad, perhaps with a dual-camera configuration for video conferencing. As far back as August, sources such as Digitimes Research have also predicted a 7-inch iPad due to hit the market either later in 2010 or the first quarter of 2011.

Editor's Note: The name of Microsoft's CEO has been corrected.

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